Corporate social responsibility in the relationship between accounting conservatism and investment efficiency

Document Type : Research Paper

Authors

1 Department of Accounting, Faculty of Social Sciences and Economics, Alzahra University, Tehran, Iran

2 Department of Accounting and Finance, Faculty of Economics and Management, Urmia University, Iran

3 Finance in the Business School, Durham University Business School, United Kingdom

Abstract

This research investigates how corporate social responsibility (CSR) affects the connection between accounting conservatism and investment efficiency. The study focuses on a sample of 530 firms that are listed in the United States and covers the period from 2015 to 2019. We contribute to the literature by incorporating ESG performance scores to measure CSR, and by investigating the moderating effect of CSR on the conservatism-investment efficiency relationship. Our results show that environmental and governance metrics positively influence investment efficiency, while social performance indicators have a negative association. Moreover, the environmental performance indicator strengthens the relationship between conservative accounting and investment efficiency, while the governance indicator weakens this association. Overall, our study provides new insights into the interplay between conservative accounting, investment efficiency, and CSR and sheds light on the importance of considering CSR in investment decision-making.

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Main Subjects

References

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Interdisciplinary Journal of Management Studies (Formerly known as Iranian Journal of Management Studies)
Volume 17, Issue 2
April 2024
Pages 507-520

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